Source: Glonui.
The global chip market is booming.
$NVIDIA (NVDA.US)$Overnight success, continuous new highs.$Taiwan Semiconductor (TSM.US)$The "hot wind" of chip stocks has blown from America to Asia, and everyone is toasting and enjoying themselves in this carnival.
Today, TSMC reached a new high in Taiwan stock market, closing up 3.71% at 978 new Taiwan dollars; Hon Hai, Mediatek and other semiconductor stocks also hit historical highs.
With the support of the AI chip boom, Taiwan's stock market has also successfully achieved a historic high today. Since the beginning of this year, the Taiwan weighted index has risen by 30%, making it the best performing market in the Asia-Pacific region.
The trillion-dollar threshold is within reach.
Last week, TSMC's market capitalization surpassed Berkshire Hathaway, owned by the "stock god" Warren Buffett, and became the world's eighth largest company by market capitalization.
As of Tuesday's close, TSMC's market capitalization reached US$932 billion, and the threshold of US$1 trillion is within reach.
TSMC's stock price has risen steadily since the beginning of this year and has accumulated a 74% increase so far.
Like Nvidia, as a major beneficiary of wide application of AI, TSMC has also gained a lot. In May alone, TSMC's sales soared 30% year-on-year, an increase of 30.1% compared to the same period last year.
At the shareholder meeting in June, the new "leader" Wei Zhejia expressed optimism about the growth of the company's demand for AI.
He predicted that the development of AI will drive the recovery of the chip industry by 2024. TSMC will continue to grow quarterly, and the annual revenue in dollars can achieve a growth of 20% to 25%.
However, it should be noted that with the crazy trend of AI, chips are gradually becoming scarce.
As the major chip contract manufacturer for technology giants, TSMC is now unable to meet the demand. Among them, TSMC's 3nm capacity has been fully taken over by its seven major customers (Nvidia, AMD, Intel, Qualcomm, MediaTek, Apple and Google), and expected orders are full until 2026.
Therefore, TSMC plans to raise prices for 3nm and 5nm. Among them, the price of 3nm wafers will increase by more than 5%, and the price of advanced packaging in 2025 will also increase by 10-20%.
Citi analysts predict that if TSMC raises prices by 5%-10% in 2025, it will bring about 3%-6% revenue growth.
The global semiconductor market is booming.
Therefore, TSMC plans to raise prices for 3nm and 5nm. The price of 3nm wafers will be raised by more than 5%, and the quote for advanced packaging in 2025 will also be raised by 10-20%.
Citigroup analyst predicts that if Taiwan Semiconductor raises prices by 5-10% in 2025, it will bring about approximately 3-6% revenue growth.
Wall Street is calling out in a loud voice.
The global semiconductor market is booming.
According to the latest SEMI report, global semiconductor wafer fab capacity is expected to increase by 6% in 2024 and 7% in 2025, reaching a historic high of 33.7 million wafer equivalents per month calculated based on 8-inch wafers, in order to keep up with the continuous growth of chip demand. Capacity for nodes of 5nm and below is expected to increase by 13% in 2024, mainly driven by the generation of AI for data center training, inference, and edge devices. Chip makers like Intel, Samsung, and Taiwan Semiconductor are preparing to produce 2nm GAA chips to improve processing efficiency, with a total advanced capacity growth rate of 17% by 2025.
Capacity for nodes of 5nm and below is expected to increase by 13% in 2024, mainly driven by the generation of AI for data center training, inference, and edge devices.
In order to improve processing efficiency, chip manufacturers including Intel, Samsung, and Taiwan Semiconductor are preparing to produce 2nm GAA chips, with a total advanced capacity growth rate of 17% by 2025.
Currently, Wall Street investment banks are bullish on Taiwan Semiconductor.
The reason is that the potential price increase in 2025 due to the surge in demand for AI could boost Taiwan Semiconductor's profits.
This week, several investment banks have raised their target prices for Taiwan Semiconductor.
JPMorgan raised its expectation for AI revenue to 35% of total sales by 2028, while Citigroup raised its target stock price by 12%, citing stronger profit prospects. Goldman Sachs expects prices for Taiwan Semiconductor's 3nm and 5nm chip manufacturing to rise by "low single-digit percentages" and has raised its 12-month target price by 19% to NT$1,160. Analysts said, "We now see Taiwan Semiconductor's risk-reward as more compelling as optimism around AI continues to build. With the continued diffusion of AI, we believe Taiwan Semiconductor is one of the major beneficiaries."
Goldman Sachs predicts that prices for Taiwan Semiconductor's 3nm and 5nm chip manufacturing will rise by "low single-digit percentages" and has raised its 12-month target price by 19% to NT$1,160. Analysts said, "We now see Taiwan Semiconductor's risk-reward as more compelling as optimism around AI continues to build. With the continued diffusion of AI, we believe Taiwan Semiconductor is one of the major beneficiaries."
"We now see Taiwan Semiconductor's risk-reward as more compelling as optimism around AI continues to build. With the continued diffusion of AI, we believe Taiwan Semiconductor is one of the major beneficiaries." Analysts said.
At the same time, Cathie Wood, also known as "Wood Sister", continues to buy Taiwan Semiconductor American Depositary Receipts. On Tuesday, her fund (ARKW) bought 3316 shares of Taiwan Semiconductor stock worth $595,852. The day before, the fund bought Taiwan Semiconductor stock worth $5.3 million.
At the same time, Cathie Wood, also known as "Wood Sister", continues to buy Taiwan Semiconductor American Depositary Receipts. On Tuesday, her fund (ARKW) bought 3316 shares of Taiwan Semiconductor stock worth $595,852. The day before, the fund bought Taiwan Semiconductor stock worth $5.3 million.
Editor/tolk